Cortana To Help Xiaomi, But Can Xiaomi Help Microsoft?

Microsoft Corporation (NASDAQ:MSFT) and Xiaomi have signed an MOU as a strategic framework to work together in various technologies. On Friday, both the companies agreed upon exploring prospects in AI (including Microsoft’s Cortana), Cloud computing and hardware.

The deal covers four major areas of services for both the companies-

Cloud support will allow Xiaomi to use Microsoft Azure for data storage, computing, bandwidth and other cloud services.

Xiaomi intends to launch laptops that run on windows and they will be co-marketed by Microsoft.

Microsoft will be cooperating with Xiaomi on AI-powered speakers (Mi AI speakers) using ‘Cortana’. They’d also be working together on other Microsoft AI products including its Bing search engine, EDGE internet browser, digital assistant Cortana, Translator, Pix, XiaoIce, SwiftKey, Cognitive services and Skype.

They also intend to work together on other technologies involving natural language processing (NLP), speech and, computer vision.

But this is not the first time when Microsoft and Xiaomi have come together. Earlier in 2015, Microsoft signed a deal to test Win10 on Xiaomi devices. Then later in 2016, Xiaomi bought about 1500 technology patents from Microsoft to preinstall Microsoft Office and Skype on its devices. So this collaboration will become another new chapter in the partnership of both the companies.

The two companies will be mutually benefitted from this partnership. Xiaomi is one of China’s most popular Smartphone brands but the Chinese vendor’s product sales have largely been confined to Asia-pacific. This deal could direct Xiaomi to raise its game in the global market, especially in the U.S, as it looks up to an IPO that has been reported to potentially value the company at $100 Billion. In a statement, the Chinese vendor said that the objective of this partnership is to make Xiaomi’s products and services better fit the global market through this partnership.

Microsoft, on the other hand, is a major player in software and services across the globe but lately failed on its phone-hardware efforts to abysmally low levels. The company tried to turn the tides in its favours by acquiring Nokia in 2013 but failed once again. The major roadblocks in the Nokia mobile business and windows smartphones were quite visible. Although its imperative to understand that mobile is an area that Microsoft cannot step away from altogether. In partnership with Xiaomi, it seems that Microsoft is making another go with the fourth largest smartphone vendor in the world – and rising – with a different approach.

Unfortunately, Xiaomi devices are not officially available in the U.S. The company has proved its mettle in the Asia-pacific region but it is trying hard to establish a presence on the global level. This deal definitely will give it an extra edge over its competitors. At the same time, this partnership would allow Microsoft to test waters indirectly once again by reaching more users around the world who are using Xiaomi products, without being burnt out much.